Foremost Golf estimates that 20% of golf purchases by consumers are now made online. American Golf – Europe’s largest retail chain in-store and online –agrees. Rather than resist the increasing significance of internet retailing, Foremost Golf has made the decision to embrace it. Paul Hedges, chief executive of Foremost Golf, explains the rationale in an exclusive interview with Robin Barwick, and states why he firmly believes Foremost’s e-commerce strategy will benefit all Foremost Golf member professionals.
Please start by explaining how offering golf products to consumers online via central Foremost e-commerce site is not taking business away from your very members.
We are enabling Foremost pros to leverage online sales with a minimum 50% of the profit, without having to spend any time or resources on it at all. The profit margin for pros from these online sales might even be more than the margin the pro would make from stocking and selling the same item.
But are Foremost online prices going to undercut your members’ pro shops?
No. The fact is that there is no longer a significant disparity between the prices of golf products sold online and in-store. The benefit of this parity in pricing is that it makes it easier for us to operate the e-commerce site without under-cutting the green-grass professional.
Doesn’t this e-commerce strategy undermine the philosophy of the pro’s expertise, customer service and custom-fitting capability?
Our recommendation to golfers, even on the website, is for them visit their local professional to get fitted for clubs, but at the same time we can’t afford to be a King Canute. We know, and our pros know, that custom fitting is the best solution, and we hope our customers know that too, but the statistics show that a significant amount of clubs are still being sold without being fitted.
There is also a new generation of adjustable clubs now, for which the fitting is about settings advice rather than actual physical product specs. A golfer can buy the latest adjustable TaylorMade driver, but might still need the advice of a professional to ensure the club is set up suitably.
We want to encourage custom-fitting, but at the same time we have to accept that if we dont sell non fitted clubs to a golfer, they will buy from someone else. We have to be commercial about it.
Do you expect Foremost e-commerce to raise the Foremost pro’s turnover?
I think it can produce incremental growth. I believe that something like 95% of footfall into pro shops is from golfers who are about to play a round of golf, which means the pro shop is not a destination shop. When the pro shop is closed it can’t make any sales, and in the build-up to Christmas it is notoriously difficult the get a wife, sister or mother of a golfer to go into a pro shop to buy Christmas presents. They buy from the high street because sometimes pro shops are in remote, inconvenient locations. E-commerce opens up the opportunity to sell to these people and to sell out of shop hours.
We also believe that the very significant market of beginner golfers are more likely to buy their equipment online than they are from a pro shop, as most beginners are not club members.
How would you encourage Foremost professionals to embrace the e-commerce strategy?
Some of our pros have taken the initiative to bring log-in facilities in-store for their customers. Typically pros have retail space that is 600 square feet or less, which typically carries £40,000-£50,000 of stock, so pros can’t hope to carry every product their customers want. The proposition now from the pro can be that he displays his core range in-store, and then uses the website to deal with everything else, and the pro can guide the customer to the e-commerce site through his own website.
If the pro prefers, they could always use the e-commerce site as a form of product catalogue, and rather than encourage customers to order online, the pro could make the product order himself. We are very happy with that, because the whole ethos is to drive the customer into the pro shop.
Whereas before, a lot of golfers might complain about the lack of product selection in a pro shop, with e-commerce a pro can provide customers with any golf product in any size that they need.
When consumers start to receive a good level of service through e-commerce we believe they will embrace it.
So is part of the hope that pro shops can win more business from existing customers via e-commerce, as well as attracting new customers?
Absolutely. I used to say to pros: ‘If you sell half of your members half of their product, you’ve done pretty well’. That equates to only 25% of sales to a pro’s customers, so our business in e-commerce is not so much to try and find new golfer, as much as it is to try and re-engage existing customers who the pro is not selling to any longer, or to get a greater proportion of that golfer’s business. There could be 75% of business to win from existing customers.